Last week, Paul Singh, a former partner at 500 Startups, announced his new innings as venture capitalist (VC) with Crystal Tech Fund. The Ashburn-based fund plans to raise $50 million to lead Series A in tech-enabled businesses across a wide range of industries and geographies.
According to Paul, over the past four years (since his debut as venture capital) the funding gap for seed stage tech startups has
shrunk considerably with over 1,300 new investors and 200 new venture firms actively participating in early stage investments globally.
In an exclusive interaction with YourStory, Paul shared his motivation behind Crystal Tech Fund and his future plans.
YS: Tell us about the motivation for becoming a VC and launching Crystal Tech Fund?
Paul: When I first started seed-stage investing in early 2010, the funding gap was at the earliest stage -- it was incredibly hard to raise your first $50K-$500K. Since then, at least 1,500 new investors (including ~200 new venture firms) are actively participating in early stage investments. In other words, the early stage funding gap has been filled.
The primary issue is that the amount of capital available at the Series A level has not proportionally increased with the amount of seed-stage capital. Today, raising a seed-round is easier than ever but raising your next round is incredibly tough. I've spent the last few years collecting incredible amounts of data from startups around the world and believe we can help fill the funding gap that now exists between the seed and Series A.
YS: Who are the other partners at Crystal Tech Fund (TCF)?
Paul: At present, I'm the only partner but will likely add some venture partners in the coming weeks.
YS: Give some sense of the nature of the fund?
Paul: Unfortunately, I can't comment on the specifics of the fund. Crystal Tech will announce its first deal in the next month. Typically the fund will invest in one to two startups per month with check sizes ranging from $250,000 to $1 million.
YS: Indian startup ecosystem is going through series A crunch. Will TCF focus on the Indian Subcontinent too?
Paul: Generally speaking, yes. As I mentioned above, we're going to be looking across a number of industries and geographies -- that includes India as well.
YS: Quick words for Indian entrepreneurs who are looking to raise series A or seed investment.
Paul: Building a business is harder that raising money, always. Indian entrepreneurs should be focused on their business -- the product, the engagement and the revenue. Investor money is always easier to raise once you have a little bit of those things.
YS: Have you completely exited from 500 startups?
Paul: Yes. I'm fully focused on Disruption Corporation and Crystal Tech Fund.